The changing role of compliance

Navigating the challenges

While the challenges facing Chief Compliance Officers have undoubtedly risen, given increasing demands from both regulators and from internal stakeholders, we see a range of innovative approaches emerging in relation to people, processes and technology which can support CCOs and Compliance functions in navigating through them successfully.

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The role of the Chief Compliance Officer (CCO) and the Compliance Function more generally is subject to ongoing and significant change, particularly in the UK.

The combination of the global financial crisis that started to emerge in 2008, continuing challenges in respect of the mis-selling of PPI and, more recently, misconduct in relation to LIBOR and foreign exchange benchmarks has put the spotlight on governance, culture and standards across the whole of the financial services industry, and particularly on banks. The political, regulatory and supervisory responses to this have been far-reaching and intense, leaving few aspects of the regulatory landscape and the governance of regulated firms untouched.

Against this background this paper explores some key areas of change that we are seeing take effect across our network of clients, looking specifically at:

changing supervisory expectations, including the move to more judgement based supervision in the UK and the consequences for the CCO and the Compliance Function;

the role of the CCO as part of the overall senior management team of the firm and the need to satisfy multiple demands from different stakeholders; and

how CCOs can respond to the changing environment and the tools and techniques available to support them.

While the challenges facing CCOs have undoubtedly risen, given increasing demands from both regulators and from internal stakeholders, we see a range of innovative approaches emerging in relation to people, processes and technology which can support CCOs and Compliance functions in navigating through them successfully.

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